Event Type: Q2 and H1 FY27 Earnings Conference Call hosted by Tamilnad Mercantile Bank Limited.

Date and Time: October 26, 2026. Specific time not mentioned in the transcript.

Purpose: Discussion of the Unaudited Financial Results for the quarter and half year ended September 30, 2026.

Management Participants:

  • Mr. Salee S. Nair, Managing Director & CEO
  • Mr. Sanjoy Kumar Goel, Chief Financial Officer

Availability of Materials: The transcript of the earnings conference call has been made available on the Bank's website at https://tmb.bank.in/investor-relation/financial-results and was also enclosed with the regulatory filing.

Compliance Statement: The conference call contained forward-looking statements based on the beliefs, opinions and expectations of the company as of the date of the call, with the standard disclaimer that these statements are not guarantees of future performance and involve risks and uncertainties.

Financial Period Discussed: Q2 and H1 FY2026-27 (quarter and half year ended September 30, 2026)

Key Financial Highlights from Management Commentary:

  • Highest ever net profit of INR451 crores, up 42.09% YoY
  • Total business grew 27.25% YoY to INR1,30,237 crores (3x the bank's 10-year CAGR of 9.41%)
  • Deposits grew 25.49% YoY to INR69,546 crores
  • Advances grew 29.32% YoY to INR60,691 crores
  • Net Interest Income stood at INR807 crores, up INR35.17 crores
  • Operating profit after expenses at INR642 crores, up 41.80%
  • ROA at 2.18%, ROE at 16.92%
  • Cost-to-income ratio at 38.28%
  • Net NPA at 0.14%, Gross NPA at 0.61%
  • Net Interest Margin at 4.19% (up 36 bps YoY, down 10 bps QoQ)
  • Capital adequacy at 32.39%
  • CASA growth at 16.26%
  • RAM focus continues at 94.33%
  • Unsecured exposure minimal at 20 basis points
  • Credit cost at 9 basis points (0.09%)
  • Slippage at 6 basis points
  • PCR on book at 77.49%, overall PCR at 96.61%
  • Portfolio at risk (NPA + SMA 0,1,2) at 2.28%

ECL Provisioning Update:

  • Bank has calculated ECL impact as of September 30, 2026 at INR384-385 crores
  • Provided fully for stressed non-fund facilities in Q1 FY27
  • Provided fully for SMA 1 and SMA 2 as per ECL norms in Q2 FY27
  • Total provisions done for ECL is INR54.24 crores along with existing contingency provision of INR250 crores
  • Total provision available of INR304.24 crores against INR385 crores required (almost 80% coverage)

Business Segment Details:

  • MSME portfolio inched up to 23.62%
  • Gold loan portfolio: Total INR29,280 crores (Agri: ~INR22,000 crores, Retail: INR6,084 crores)
  • Gold loan portfolio LTV stands at 62.35%
  • Portfolio sensitivity: 20% price reversal would affect 3.13% of gold loan portfolio
  • Gold loan SMA plus NPA together at INR28 crores (0.10% of portfolio)
  • Average gold loan ticket size: INR2.66 lakhs

Funding and Liquidity:

  • Cost of deposits moved up to 5.85% from 5.68%
  • Cost of funds at 5.93%
  • Picked up ~INR1,000 crores of refinance during quarter at 7.5%
  • Non-callable deposits share in incremental term deposits: 40.62%
  • FCNR(B) deposit growth of 47.14% (USD51.94 million)
  • LCR at 139.43%, NSFR at 146.15%, Leverage ratio at 11.99%

Advances Portfolio Composition:

  • 52% repo-linked, 43% MCLR-linked, 5% treasury-linked, ~4.85% fixed rate
  • 95% of loan book is floating rate
  • Reset typically happens quarterly for repo-linked loans

Branch Expansion:

  • Opened 9 branches in H1 FY27
  • Committed to open 60 branches for full year
  • Year-on-year opened 37 branches, with 15 outside Tamil Nadu
  • Expect to open 20+ branches outside Tamil Nadu in FY27

Forward-looking Guidance (Revised):

  • Deposit growth guidance: 20%+ (previously 18%+)
  • Advances growth guidance: 22%+
  • NIM expected to be around 4.10% ± 5 bps for rest of the year
  • Cost-to-income ratio expected to be well below 44% (previously below 45%)
  • Long-term ambition: Grow 4-5% faster than industry growth rate

Other Business Updates:

  • Insurance commission income: INR9 crores in first half year
  • Profit per employee: INR35 lakhs, up 36.45%
  • Business per employee: INR25 crores

Regulatory Matter Update:

  • Application filed with RBI to regularize transfer of shares following Appellate Tribunal order dated July 9, 2026
  • Awaiting RBI's response and will abide by regulator's decision

Additional Notes Section

The document includes the complete transcript of the earnings conference call with detailed management commentary and Q&A session with analysts. No standalone financial statements or data tables were included in this specific disclosure - all financial figures were extracted from the management commentary during the call. The bank emphasized that the strong performance was driven by core business growth without exceptional items.